Average homeowner would pay $27 per year more under Ogden tax increase proposal

OGDEN — The average Ogden homeowner can expect their city property tax bill to increase by about $27 in 2019 if the city administration’s proposed tax increase is adopted.

The City Council is considering a request from Mayor Mike Caldwell’s office to keep the same city property tax rate that was in place last fiscal year, but because homes in Ogden are now more valuable, the amount of taxes homeowners pay will go up.

The city’s current tax rate is .003103, but for the city to have the same income next year, the tax rate for 2019 should be .002851, or more than 8 percent lower, the Weber County Auditor calculated.

Council Executive Director Janene Eller-Smith said if the council keeps the 2018 rate in 2019, it will translate to an increase of $27.17 per year for the average household. The average home value in Ogden is currently $196,000, Eller-Smith said.

Eller-Smith also reiterated the $27 increase is only the city portion of a resident’s property tax bill — so if entities like the county or the school district follow a similar path, the increase would be even more.

The auditor determines cities’ rates based on the previous year’s assessed property valuations. Rates move up and down based on each year’s valuations to guarantee a city receives the same amount of property tax revenue as it did the prior year, discounting new development.

So when property values go up, a city’s property tax rate go down. The law is in place to prevent local governments from getting an influx of money just because property values have gone up.

When a city veers up from the county-issued certified rate, it must hold a Truth in Taxation hearing. The council is scheduled to discuss the tax rate and the 2019 budget at 6 p.m. hearings on June 26, July 10 and Aug. 7 at the Ogden Municipal Building, 2549 Washington Blvd.

Eller-Smith said Ogden has the third highest property tax rate in Utah, behind only Salt Lake City and West Valley.

“It is one of the highest rates in the state,” she said. “People complain about that and we have to own it. It’s true.”

If the current rate is approved, the city expects to receive an additional $1.2 million in revenues. Caldwell said the proposal is necessary to do things like properly fund necessary city services and fairly compensate city employees.

In 1999 the city received $8.9 million in property tax revenue, equal to $13.7 million in today’s dollars.

As part of the city’s proposed budget, $12 million would be collected in 2019. That means the city would collect about 11 percent less in property tax revenue than it did 20 years ago.

“Just capturing new growth works when you are working with a city like Farmington — when you’ve got a small residential area and hundreds or potentially thousands of acres of bare ground where you can capture a whole bunch of new growth,” Caldwell said. “The dynamic is entirely different when you work with a built-out city like Ogden. We’ve been built-out since the 40s and 50s.”